CANADA FX DEBT-C$ hits 9-day low vs US$ on growth fears

Fri Jul 16, 2010 11:32am EDT
 
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* C$ at 94.95 U.S. cents on Friday morning

* Concerns over U.S. recovery hurting commodity currencies

* Bonds rally in safe-haven bid (Adds details following U.S. data releases)

By John McCrank

TORONTO, July 16 (Reuters) - Canada's dollar sank to a nine-day low against its U.S. counterpart on Friday as growing concerns about the strength of the U.S. economic recovery and the pace of growth in China dampened demand for commodity-based currencies.

Canada is a major exporter of commodities such as oil, natural gas, copper, and gold, and about three-quarters of the country's exports are absorbed by the United States.

A raft of recent U.S. economic data has come in weaker than market forecasters had predicted, stoking concerns that the health of the world's No. 1 economy is taking a turn for the worse.

Data this week out of China also prompted concerns among market players that growth there is less robust than expected.

"We remain Canadian dollar bears because we think that the increased uncertainty about the U.S. and the Chinese recoveries will continue to weigh on sentiment and therefore your commodity-based currencies," said Matthew Strauss, a senior currency strategist at RBC Capital Markets.   Continued...